3 ms·

So you determine the inherent value of something based on its price action? To flesh this out: I'm not arguing that BTC has no value, nor that it has no extern

So you determine the inherent value of something based on its price action? To flesh this out: I'm not arguing that BTC has no value, nor that it has no externalities, so I really don't understand what motivates your reply. I don't feel that there's anything nihilistic about pointing out the logical flaw in saying, "oh the concept of Bitcoin has 12% more inherent value now than yesterday because the price went up by that much." I recognize that the article is about electricity, but I'm not sure how you get from my comment to electricity. If Bitcoin crashes tomorrow, does that mean that the inherent value (or conversely, the societal burden) of the concept went down?

JumpCrisscross 6y ago
> So you determine the inherent value of something based on its price action? Not at all. But in this case, the broader cost of Bitcoin scales with its price.
- totalZero 6y ago
  Sure, and the cost to Hasbro of making monopoly money could scale with its price if there were a market for it. But the inherent value of a monopoly dollar would not be dependent upon that cost. When you say "the broader cost of bitcoin" you're talking about electricity right? Aside from the important fact that "cost" isn't "value", there are a couple problems with that. First of all, many people are finding arbs in energy (eg, you live or work in a dorm, lab, or other building where don't pay an electric bill) and using free electricity to mine. That provides liquidity/fungibility by contributing to transactions, without incurring any cost to the miner. Second, people and entities with large early reserves of bitcoin have an incentive to mine even when the energy cost is greater than the mining return, because a better functioning bitcoin is more likely to attract further inflows that impact the price upward.

3 ms·

So you determine the inherent value of something based on its price action? To flesh this out: I'm not arguing that BTC has no value, nor that it has no extern

by totalZero 6y ago

JumpCrisscross 6y ago
> So you determine the inherent value of something based on its price action? Not at all. But in this case, the broader cost of Bitcoin scales with its price.
- totalZero 6y ago
  Sure, and the cost to Hasbro of making monopoly money could scale with its price if there were a market for it. But the inherent value of a monopoly dollar would not be dependent upon that cost. When you say "the broader cost of bitcoin" you're talking about electricity right? Aside from the important fact that "cost" isn't "value", there are a couple problems with that. First of all, many people are finding arbs in energy (eg, you live or work in a dorm, lab, or other building where don't pay an electric bill) and using free electricity to mine. That provides liquidity/fungibility by contributing to transactions, without incurring any cost to the miner. Second, people and entities with large early reserves of bitcoin have an incentive to mine even when the energy cost is greater than the mining return, because a better functioning bitcoin is more likely to attract further inflows that impact the price upward.